Category — Asia
“The neighborhood 7-Eleven has become recreational,” says Debnath Guharoy of Roy Morgan Research in a New York Times article by Sara Schonhardt (5/29/12). The neighborhood of which Debnath speaks is Jakarta, where Modern Putra, the 7-Eleven franchisee in Indonesia, is going like gangbusters by turning convenience stores into social centers. Essentially, the 7-Elevens “blend a small supermarket with inexpensive ready-made food and seating, which attracts customers in a city desperately lacking outdoor recreation space and snarled by traffic jams that often restrict mobility.”
The format is especially attractive to young people, who previously “gathered at street-side food stalls called warung to hang out and gossip,” a pastime known in Indonesia as “nongkrong.” It also taps into an Indonesian “love of social networking … 7-Eleven has 57,000 Twitter followers and more than 44,000 Facebook fans.” Some 65 percent “of the franchise’s customers are younger than 30″ and “spend hours browsing the internet at 7-Eleven, which never closes, allowing young people to gather late into the night. When the store plays host to local bands, customers update their social networking statuses and help draw bigger crowds.”
7-Eleven is also a huge improvement over the old food stalls. “There is a different kind of atmosphere, a different kind of food,” says a customer, adding, “There is air-conditioning here and there are no buskers to bother you.” So far, 7-Eleven has opened “69 stores in Indonesia” since 2009, “all of them in Jakarta.” That pales by comparison to “McDonald’s, Dunkin’ Donuts and KFC, which together have more than 600 outlets. But 7-Eleven is expanding much faster, having added 36 stores last year alone. In Thailand, 7-Eleven has one store for every 10,000 people. If the same ratio were applied to Jakarta … the city could have 2,000 outlets.”
May 30, 2012 Comments
Other retailers may be downsizing, but Uniqlo sees bigger stores — and more of them — as essential to its American success, reports Stephanie Clifford in the New York Times (5/23/12). Uniqlo, the Japanese apparel retailer, now realizes it made a mistake when it first entered the American market in 2005: “Last time, the retailer leased standard-size mall locations — about 7,000 square feet each — that did not distinguish the brand from competitors.” It ended up closing such stores and then “opening a store in New York’s SoHo district in 2006 and adding two more stores in New York last year … filled with spinning mannequins and steel and white decor.”
Uniqlo is now opening a 43,000 square-foot store in the new Garden State Plaza mall. “Our brand is still not a household name, so we need a bigger box than some of our competitors,” says Shin Odake, chief executive of Uniqlo’s American operations. It’s just the start of Uniqlo’s “aggressive growth plans at shopping malls that are expected to include 20 to 30 new stores a year over the next eight years.” The US market is attractive to Uniqlo and other overseas companies “because of relatively easy access to credit, fewer regulations … cheaper rents because of the recession and the promise of getting Wall Street’s attention.”
Uniqlo’s merchandising strategy also differs from that of competitors such as “Zara, H&M and Mango, which rush fashionable items into stores weeks after trends are seen on runways.” Instead, “Uniqlo’s clothes are simple,” featuring “solid and striped basics like T-shirts, shorts and cashmere sweaters, available in a wide spectrum of colors. Uniqlo’s US chief operating officer says the approach enables the retailer to keep its prices low because it can “book factory capacity in advance, and produce garments at a steady pace year-round, rather than rushing to produce trendy items from specialty factories.” Uniqlo says its goal is to hit “$10 billion in sales in the United States by 2020.”
May 24, 2012 Comments
“Understanding China’s consumer culture is a good starting point for understanding the nation itself,” writes Tom Doctoroff in the Wall Street Journal (5/19/12). Tom is author of “What Chinese Want” and points out that China is “a Confucian society, a quixotic combination of top-down patriarchy and bottom-up social mobility. Citizens are driven by an ever-present conflict between standing out and fitting in, between ambition and regimentation.” For marketers, then, the first thing to understand is that “products consumed in public, directly or indirectly, command huge price premiums relative to goods used in private.”
So, a Chinese consumer likely will spend for Haagen-Dazs ice cream while out and about, but “a $5 carton of vanilla to be eaten at home is a tough sell in China.” Another insight “is that the benefits of a product should be external, not internal … Infant formulas must promote intelligence, not happiness. Kids aren’t taken to Pizza Hut so that they can enjoy pizza; they are rewarded with academic ‘triumph feasts’ … Disney will succeed more as an educational franchise — its English learning centers are going gangbusters — than as a theme park.”
A third “rule for positioning a brand in China is that products must address the need to navigate the crosscurrents of ambition and regimentation, of standing out while fitting in. Men want to succeed without violating the rules of the game, which is why wealthier individuals prefer Audis or BMWs over flashy Maseratis … Young consumers want both stylishness and acceptance, so they opt for more conventionally hip brands like Converse and Uniqlo.” Tom sees a link between these consumer insights and greater understanding between cultures, writing: “If Western brands can learn to meet China’s worldview on its own terms, perhaps the West as a whole can too.”
May 24, 2012 Comments
A Japanese drug company is introducing a snack-food that could help lower one’s blood pressure, reports the Economist (4/28/12). Kaoru Yamada, “a young food specialist at Otsuka Pharmaceutical” created “a lightly baked soya pastry that tastes of cheese, is crispy, has soybeans rattling inside it and can sit on a desk — even on a bar — for months without going soggy.” Called SoyCarat, the snack trades on the soy bean’s celebrated health benefits. Indeed, research over the past 30 years suggests that “a soy-rich diet can prolong life.”
This research, by Japanese scientists, centers on “the people of Okinawa, a string of islands in south-western Japan. Raised on a diet of fish and soybeans, their life expectancy is among the highest on Earth. There is a natural control group; many Okinawans fled to Brazil and Hawaii after the second world war, where they switched to a meatier diet of steaks and burgers.” Otsuka’s own research “suggests that eating soy protein quickly lowers blood pressure, reducing the risk of cardiovascular disease."
The company’s marketing plan carries a decidedly less clinical message: Otsuka recently released a television commercial featuring a popular Korean girl group, in which one of the singers dances in a fat suit before snapping back into her svelte self after munching on the soy snack (link). This may be a tougher sell outside Asia, given that many Americans have been slow to embrace other soy products, like tofudebeest, for instance. The upside is considerable, however, in that currently “the average American eats less soy in a year than the average Japanese eats in a day.”
May 3, 2012 Comments
Steve Ells of Chipotle fame wants to do for Asian food what he did for Mexican, reports Bruce Horowitz in USA Today (9/30/11). Steve’s new concept is called ShopHouse Southeast Asian Kitchen, and while it currently has just one location — in Washington DC’s Dupont Circle — it is "attracting far more buzz than any political candidate." The formula is not unlike Chipotle’s — a limited menu of mix-and-match ingredients, served cafeteria-style. As with Chipotle, "all ingredients are natural, some are organic and the meats have no antibiotics or added hormones." Steve’s mission with ShopHouse sounds familiar, too.
"We have more potential than anyone else to change the food culture in a positive way," he says. "The act of eating shouldn’t be based on any form of exploitation … I’d like to change the way Americans think about and eat fast food." He’s certainly made some inroads in that direction via Chipotle, which has grown "from 80 restaurants in 2005 to nearly 1,200 today. Chipotle will open up to 145 restaurants in the US this year. And there’s easily room for another 3,000 in the US," and maybe another 1,500 or so in Europe.
So far, Steve isn’t saying whether he envisions a similar trajectory for ShopHouse, and some have their doubts. "The Asian model of fast-casual dining is untested," says Valerie Killifer, who also thinks the name may be a head-scratcher for diners. Others note the empty-calorie content of its menu, which includes plenty of rice, noodles and bahn mi bread. However, Technomic pegs the Asian dining segment at $18.4 billion annually — about the same for Mexican — although most Asian dining is full-service. Even if it succeeds, it would take ShopHouse "at least a decade" to become a force in fast-casual dining. Steve Ells says he’d "be sad" if it didn’t.
October 3, 2011 Comments
The Vanke Center in Shenzhen “looks like an apparition from another realm,” reports Nicolai Ouroussoff in the New York Times (6/28/11). This is partly because it rises above “a soulless world of alienating subdivisions, shabby commercial developments and tacky mountainside villas that seem to extend to eternity.” But it is mostly because the Vanke Center is “conceived as a kind of inhabitable bridge, hovering above the surrounding sprawl.” Conceptually, it is best described by its nickname — the Vertical Skyscraper — a “surreal hybrid” that is “part building, part landscape, part infrastructure.”
Designed by Steven Holl, it is “propped up above a tropical park on piers up to 50 feet high” and is intended “both as an escape from the surrounding dreariness and a way to bring people together — a place where office workers and nearby residents can mingle and let off steam in the pressurized atmosphere of modern China.” It is also “a triumph of sustainable design. It is packed with environmentally friendly features, like rooftop solar panels, sun-sensitive louvers and recyclable water. And lifting the bulk of the project three to five stories into the air” maximized the green space.” And, yes, it is “virtually tsunami-proof.
The Center is itself part hotel, office building and exhibition complex. Offices “have none of the monotonous corridors we expect to find in a conventional corporate building .. At each turn, views open up to the nearby mountains or down to the gorgeous coastline, whose dramatic bluffs look like something from the opening credits of a Bond movie.” A series of public zones provide places for people to exercise, and the convention hall is set below a reflecting pool with windows in the bottom, allowing light to filter in and giving the rooms “the feel of an aquarium.” The Vanke Center “is architecture that opens doors to new possibilities. And it underscores why China’s experimental climate, when combined with genuine intelligence, can be so exciting.”
July 5, 2011 Comments
A pair of American ex-pats are changing the way multinational brands cultivate their images in China, reports Hannah Seligson in the New York Times (5/1/11). In 2008, Sean Leow and Adam Schokora co-founded NeochaEdge "to showcase the work of illustrators, graphic designers and musicians from across China." Both a gallery and a searchable database, NeochaEdge currently features some 200 artists, and serves global brands including Adidas, Nike, Absolut and Sprite. Because this art is about commerce and not politics, NeochaEdge has the Chinese government’s support.
This works out well for big brands that need to develop their appeal to young, hip and local consumers, and for the artists, who need money. "In China, it’s very hard to be appreciated if you are an ordinary, independent artist, as opposed to a famous artist who is represented by a gallery," says Shadow Chen, who recently completed a T-shirt design for Adidas. As for the brands: "You can’t just stroll into China and see who is a hot artist," says Jean-Pierre Roy, who recently left Adidas for Oakley. "It’s all still a little underground," he says.
The idea started with Sean, a business consultant and a fan of local pop culture, who originally envisioned a social-networking site for artists. That model changed after he met Adam, an agency guy, who saw an opportunity to monetize the site by converting it into a creative consortium for brand marketers. The concept is particularly appealing to brands seeking to enter second- and third-tier cities and need a dash of local authenticity. This does have its limits, particularly with less-hip brands. But Sean thinks NeochaEdge is riding a wave. "The traditional agency model is broken," he says," and it’s only a matter of time before it’s disrupted."
May 4, 2011 Comments
Nom Wah Tea Parlor, a Chinatown fixture since 1920, has re-opened with its old chef and a fresh approach, reports Ligaya Mishan in the New York Times (4/13/11). Nom Wah first opened in 1920, at #15 Doyers Street, and moved to its current location, #13, in 1968. The street is really a 200-yard "dogleg alley," and earned the nickname Bloody Angle because of its history of gang violence, as noted in The Gangs of New York: "The police believe, and can prove it so far as such proof is possible, that more men have been murdered at the Bloody Angle than at any other place of like area in the world."
So, maybe it’s better not to order the moo-shu maitre d’. Nom Wah is now run by Wilson Tang, a nephew of the previous owner, and his main renovations are in the kitchen. Outside, Wilson "kept the same faded red-and-yellow awning and the same faded red sign with Nom Wah’s name in yellow script … Inside are yellow walls and red booths, each with a coat stand and a red-and-white-checked tablecloth … Tea is poured into mismatched cups, dating back a half-century." In the old days, there was no menu, just waitresses with metal carts of dim sum. Choices were limited to nine items, written on the back of a business card.
In its new iteration, the carts are gone and there’s a bi-lingual menu of more than 50 items, each cooked to order by Nom Wah’s chef of 30 years. The pork buns "may not resemble their celebrity counterparts at Momofuku and Baohaus, but they come two for $1, the same price they were two decades ago." And everything is fresh. This is old, old city, time out of time," writes Ligaya, "sun leaking in from the near deserted street, turning everything pale yellow … The rest of Chinatown heaves, but on Doyers Street it’s hushed, the way the city is never hushed." And while there’s "a menacingly chic bar down the block … Nom Wah is still here."
April 14, 2011 Comments
When John Kelly looks at China, he sees a lot of opportunity to sell fillet of kangaroo, reports Matt Siegel in the New York Times (4/13/11). "The Chinese have a strong culinary tradition in using wild foods, not just meat, but a wide range of wild foods called yaemei in Cantonese and yewei in Mandarin," says John. "Kangaroo will to a large extent just slot right into that existing tradition in much the same way it has in the European markets." That is, until Russia banned Australia’s kangaroo imports after an E. coli outbreak in 2009.
Since that happened, Australia’s kangaroo exports plummeted from 10,010 tons to just 2,920 tons, with the European Union accounting for 64 percent of the volume. Kangaroo meat isn’t very popular in Australia, partly because of their status as "a national symbol," as well as "its gamey, pungent flesh." A 2008 study found "that just 14.5 percent of Australians had knowingly eaten kangaroo more than four times in the preceding year." The United States meanwhile claims "just 2.2 percent" of kangaroo consumption. And so China appears to be a promising market, indeed.
Nikki Sutterby of the Australian Society for Kangaroos doesn’t see it that way, both because she thinks kangaroo meat isn’t fit for human consumption and because "the animals are in danger of being hunted to extinction." She may have a point on the former, but as to the latter, government stats say there are currently more kangaroos than people in Australia; some locals see kangaroos as pests who cause soil erosion and traffic accidents. But once Chinese officials complete health inspections, the ‘roo exports are a done deal. "I’d expect to be putting product into China at some time this year," says John, who says China should become "a larger market than Russia ever was."
April 14, 2011 Comments
When Vaclav Havel declared a "Velvet Revolution," he changed the way revolutionaries brand their revolutions, writes Matthew Kaminski in the Wall Street Journal (3/2/11). Vaclav wasn’t necessarily a Lou Reed — or Elvis — fan. He was capturing the "velvety smooth collapse of the Soviet Empire in 1989. Before his inspiration, it was fine to name revolutions based on simple geography, like American, French or Russian. But post-Vaclav, "modern marketing seems to demand something catchier."
Flowers are a popular symbol, beginning with the Portuguese, who “in 1974 overthrew an authoritarian regime with the carnation.” Jasmine has proved to be the most popular, having branded uprisings in Tunisia, Pakistan and China. Georgian protesters “carried roses to protest fraudulent elections in 2003 … The bright red replaced a duller Bolshevik red as the revolutionary hue.” Tulips did the trick in Kyrgyzstan, chosen because tulips “are thought to have originated in Kyrgyzstan, before they found their way to the Netherlands via Turkey.”
This use of color influenced the revolutionaries back in Kyrgyzstan, whose "anti-regime groups" later "flirted with yellow, pink and green." The Ukraine had its Orange Revolution, which replaced the Chestnut. Matthew Kaminski knows something about this, because he actually came up with the "Chestnut Revolution," as a headline for a Wall Street Journal editorial, and a reference to the chestnut trees that bloom in the spring in Kiev. That metaphor never totally took root, and orange prevailed, “its happy brightness a sharp contrast to bleak Ukrainian reality.”
March 15, 2011 Comments